Screening Filters
Beta = LowRisk
- Purpose: Find stocks with lower market sensitivity.
- Rationale: The user wants defensive stocks that can better withstand a correction. Low-beta names generally move less than the broader market, which makes them more suitable for downside resilience.
Sector = Utilities, Consumer Non-Cyclicals, Healthcare
- Purpose: Focus on traditionally defensive sectors.
- Rationale: These sectors tend to have steadier demand and more stable cash flows during market selloffs. Utilities are essential services, consumer non-cyclicals provide everyday necessities, and healthcare is generally less economically sensitive than cyclical sectors.
Industry = Food & Tobacco
- Purpose: Narrow the search to especially defensive industries within consumer staples.
- Rationale: Food and tobacco businesses often have recurring demand, pricing power, and strong cash generation, which can help them hold up better in a market downturn.
Theme = Tobacco
- Purpose: Include tobacco-focused companies with defensive characteristics.
- Rationale: Tobacco companies often have high margins, consistent free cash flow, and meaningful dividend policies, making them a common fit for defensive income screens.
Free Cash Flow TTM > 0
- Purpose: Require the company to generate real cash after capital expenditures.
- Rationale: Dividend safety matters in a downturn. Positive free cash flow is one of the best signs that dividends are being funded sustainably, not just through accounting earnings.
Net Margin > 0
- Purpose: Ensure the company is profitable on a bottom-line basis.
- Rationale: Positive net margin helps confirm the business is not only generating revenue, but also keeping enough profit to support dividends and absorb stress.
Operating Margin > 0
- Purpose: Screen for companies with profitable core operations.
- Rationale: A positive operating margin suggests the core business is healthy before financing and tax effects. That is especially important for defensive names expected to remain stable in a correction.
Current Ratio ≥ 1
- Purpose: Check short-term liquidity.
- Rationale: A current ratio at or above 1 suggests the company has enough short-term assets to cover short-term liabilities, which improves financial resilience if markets weaken.
Dividend Yield TTM ≥ 3%
- Purpose: Target stocks that provide meaningful income.
- Rationale: The user is specifically asking for dividend-paying defensive stocks. A 3% minimum yield filters for names that provide attractive income while waiting through volatility.
Dividend Payout Ratio ≤ 80%
- Purpose: Avoid dividends that look stretched.
- Rationale: A payout ratio capped at 80% helps exclude companies that are returning too much of their earnings. That improves the odds the dividend can be maintained during a market correction or earnings slowdown.
Why These Filters Match the User’s Request
- They directly target defensive dividend stocks rather than high-growth or cyclical names.
- The screen emphasizes downside resilience through low beta and defensive sectors.
- It also adds fundamental quality checks: positive free cash flow, profitability, and liquidity.
- The income filters ensure the results are actually meaningful dividend payers, while the payout cap helps screen for sustainability.
Filter Match Check
- Yes, the filters match the user’s request.
- The requested indicators are all supported and were applied appropriately.
- Together, they are well-suited to finding stocks that are more likely to hold up relatively well in a 10% correction while still paying a sustainable dividend.
If you want, I can also explain which of these filters is the most important for defensive performance and which ones are mainly for dividend safety.
This list is generated based on data from one or more third party data providers. It is provided for informational purposes only by Intellectia.AI, and is not investment advice or a recommendation. Intellectia does not make any warranty or guarantee relating to the accuracy, timeliness or completeness of any third-party information, and the provision of this information does not constitute a recommendation.